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Monthly Archives: December 2015

FinTech and the Presidential Election Will Try to Kill You, But Won’t Succeed Just Yet

Financial manufacturers including banks, factors and all manner of secured and unsecured lenders must prepare for accelerating uncertainty in 2016. Global economic turbulence, a rapidly shifting lending landscape full of FinTech start-ups, and the looming presidential election could stand in the way of more champagne and caviar. There are plenty of reasons to ignore Einstein’s famous adage now: prepare at once for war and peace.

There is also much good to toast come December 31. Lenders that kept their foot on the accelerator over the past five years are enjoying record originations and rising valuations. And the party is likely far from over.

Who is that masked man?

The identity of the man behind the development of the bitcoin is still unknown, despite a raid by police on the home of an Australian tech entrepreneur who was named by US publications Gizmodo and Wired as the creator of the cryptocurrency on the basis of leaked interview transcripts.

More than ten police officers arrived at the house of Craig Wright in the Sydney suburb of Gordon ready to perform a search of the property, although the raid was apparently not related to the bitcoin claims, according to the Australian Federal Police, who said: ‘The AFP can confirm it has conducted search warrants to assist the Australian Taxation Office at a residence in Gordon and a business premises in Ryde, Sydney. This matter is unrelated to recent media reporting regarding the digital currency bitcoin.’

People who claim to know Wright have expressed doubts about the likelihood of his involvement, with some saying they believe Gizmodo and Wired have been the victims of an elaborate hoax.

The black stuff

Crude oil prices have fallen to their lowest levels since the global financial crisis, with further losses likely in the coming weeks. On 4 December, the Organization for Petroleum Exporting Countries (Opec) voted to continue its policy of acquiring market share rather than supporting prices, which resulted in US crude oil values dipping to under $40 a barrel. Values are now at their lowest levels since December 2008, when crude-oil futures price fell to around $34.

Opec’s decision to maintain its market share strategy is only part of the story, with the cartel’s organisational disarray stimulating renewed selling and causing widespread anxiety in the sector.

Coming in to land

If you were one of the millions of Americans who travelled by plane over the Thanksgiving break – perhaps heading home for a family gathering – you may also be among the most disgruntled air travellers in the world. Fact is, US airports are lagging way behind other countries in the world rankings, losing out to their Asian counterparts, as well as some European hubs.

All systems go

With businesses poised for news of an interest rate rise this month, the world’s economy seems to be pulling in two directions. A gentle nudge from 0.25% to 0.5% may not seem like a major move for the Federal Reserve but it’s a move that would have sparked anxiety a year or so ago and will mark the transition towards a more optimistic outlook in the US.

Bumper tax bill

Starbucks and Fiat Chrysler are each in line for a painful multi-million euro tax bill as they prepare to face a ruling by the European Commission (EC), that they had unlawful deals with the Netherlands and Luxembourg.

MEPs have been lobbying for the EC to look closely at allegations that multinationals have benefited hugely from the willingness of some member states to offer special terms to companies willing to funnel their profits through them, using the European bases as little more than a convenient mailbox. The head of competition policy at the EC, Joaquín Almunia, had previously said that companies should not be able to ‘understate their taxable profits by using favourable calculation methods…or receive preferential treatment [that] could amount to hidden subsidies.’ In other words, EU members shouldn’t be conspiring with multinationals just so they can dodge tax obligations and hold on to a bigger slice of the profits pie.